Eonomic Growth
The political, economic, cultural, and legal systems of a country all have a significant impact on the level of economic development; and therefore, on the attractiveness of a country for firms, domestic and international. These systems are interdependent; it is important to realize that the interplay between the political, economic, legal, and cultural structures of a country greatly affect the level of economic well-being. In addition to these systems, it is important for a country to work toward the globalization of its economy.
The political system shapes the economic and legal systems of a country. There are two key dimensions of a beneficial political system that advocates free market economics: a philosophy based on individualism and a representative democratic government. Individualism urges that the individual economic and political freedoms are the foundation on which a society is built. It is important to emphasize that the U.S. government guarantees individual freedom and self-expression; furthermore, people pursing their own economic self-interest best serves the overall welfare of a society. In a representative democracy, there are nine safeguards preserved into law that guarantee elected representatives are held accountable: freedom of expression, opinion, and organization; free media; regular elections in which all eligible voters can participate; universal adult suffrage; limited terms for politicians; fair judicial system (separate from political system); nonpolitical state bureaucracy; nonpolitical police force and armed service; and relatively free access to state information.
The economic system, which is closely connected to the political ideology of a nation, must be a market economy in order to foster any lasting economic growth. A market economy's supply and demand determines the quantity in which goods and services are produced. The role of the nation's government must be to encourage competition between private...
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